Firm threatened with court action over debt claim

Speciality Steel UK Limited has announced plans to address its financial difficulties

A winding up petition has been lodged against a South Yorkshire steel firm amid major restructuring plans.

A hearing at London's Business and Property Courts on Wednesday will consider Harsco Metal Group Limited's claim that Speciality Steel UK Limited, a division of Liberty Steel, owes money and should be closed by the courts if it cannot pay creditors.

Earlier this week Speciality Steel UK Limited, which has sites in Stocksbridge and Rotherham, shared restructuring plans which aim to "significantly" reduce its debts.

Harsco Metal Group Limited and Speciality Steel UK Limited did not respond when approached by the BBC.

A winding up petition is a form of legal action taken by a creditor against a company that owes them money. If the company is deemed to be insolvent, an official receiver will be appointed to liquidate it.

Announcing its restructuring plans, Specialty Steel UK said they would be a "major step in the company’s recovery" and have "no impact" on employees.

According to the announcement, all creditors would be presented with a detailed proposal and have the opportunity to vote on the plan.

Jeffrey Kabel, Liberty Steel Group chief transformation officer, said: "After making significant progress to stabilise the business and refocus it on high value specialist products, we’re now addressing the debt position of the company to create a stronger speciality business going forward."

'Seek resolutions'

Trade union Community said staff morale at Speciality Steel UK and Liberty Steel businesses was currently low.

Community's national officer for steel, Alun Davies, said: "The workforce want stability.

"Community officials, including myself and our general secretary, recently met with [executive chairman of the Liberty House Group] Sanjeev Gupta and Jeff Kabel to convey the concerns of our members at Stocksbridge and other Liberty businesses, and received assurances that the company will be meeting with its creditors in December to seek resolutions to its current financial position."

Mr Davies said the union would be monitoring the situation and push for further meetings with the company on behalf of members.

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